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Snacking Innovation Summit trend-watching: Mini-meals, tapas-style eating, and hero SKUs

By Elaine Watson+

17-Feb-2017
Last updated on 20-Feb-2017 at 16:37 GMT2017-02-20T16:37:59Z

The snacking innovation summit is now available on demand
The snacking innovation summit is now available on demand

The trend towards continuous grazing throughout the day will create new ‘multi-temperature’ snacking opportunities for manufacturers as a ‘tapas-style’ approach to eating gains momentum, predicted panelists at the FoodNavigator-USA/BakeryandSnacks snacking innovation summit.

Speaking during the opening trend-watching panel debate  at the event– which is now available to watch on demand by registering HERE , Brad Barnhorn (who has worked with a flurry of high profile brands from KeVita and KRAVE to Health Warrior) said it was more helpful to think about snacks in terms of usage occasions or need states rather than narrowly defined product categories.

Viewed through this lens, snacks could be treats, indulgences, protein fixes, carb rushes, energy boosts, or hot or cold mini meals, from yogurts or drinkable soup to HPP fruit pouches to chilled bars, he said: “I look at snacks longer term as mini meals as there is a blurring between meals and snacks; it’s a tapas approach to eating throughout the day

“So temperature states are part of that too – we'll see more refrigerated snacks but also opportunities for meals to become snacks, so a single serve eggplant parmesan. We’re seeing snacking move out of the center of the store into deli, produce, and refrigerated sets.

"And part of this is because the younger consumer is shopping the perimeter rather than the center of the store, so retailers are going where that consumer is shopping.”

We’re seeing snacking move out of the center of the store

In some cases, new snack categories have been created because emerging products don’t fit within existing segments and new merchandising solutions are needed, he said, citing the rise of fruit and vegetable snack brands such as Barnana, Dang Foods, Peeled Snacks and Rhythm Superfoods, which don't belong in the salty snacks aisle.

“Sometimes brands are even getting together and collectively presenting to retailers a logic for where these new sets of products deserve to live – whether that’s in produce or by the checkout or somewhere on the perimeter.”

It’s easy to look for the next shiny object and there are reasons to extend and build a platform, but you need to ensure that your core SKUs are winning. You can’t build a $50m business on 50 $1m SKUs.”

Brad Barnhorn

Fruit and vegetable chips

Fellow panel member Vincent Kitirattragarn, co-founder of Dang Foods (which is best known for its toasted coconut chips, but has recently expanded into onion chis and sticky rice chipsadded: “Retailers are still figuring out what to do with the set, but my recommendation is put them in produce.”

He added: “There are four major trends I am seeing in fruit and vegetable chips. The first is that all the growth is coming from the conventional channel…The second is that a large amount of the growth is coming from pea puffs [building on the success of Calbee Snapea Crisps], so Peeled Snacks has come out with its Peas Please product and it’s been killing it, and also Pretzel Crisps is also going into the pea puff category.

“The third trend is that there's a lot of activity in coconut and bananas, and the last trend, I’d say, is the downfall of kale. You’re seeing double digit declines from Alive and Radiant, and Brad’s Raw Foods, while Rhythm Superfoods has been able to successfully diversify beyond kale into other areas such as beet chips.”

CRICKETS: Fad or trend?

“It plays into a broader very comfortable macro trend for consumers, which is protein. I think it’s going to be one of the segments that methodically grows but I don’t think it’s going to be an explosive change where you get an inflexion point and all of a sudden it ends up with broad mainstream acceptance.”

Brad Barnhorn 

“I just don’t think the trend has legs… it’s a niche play.”

Krik Angacion 

Americans eat too much sugar and don’t get enough fiber

When it comes to protein, Kitirattragarn acknowledged that it was a hot trend, although he queried whether there was too much emphasis on it, adding: “I think Americans eat too much sugar and don’t get enough fiber.”

Fellow panel member Krik Angacion, co-founder of pea-protein chip brand Protes, however, said protein was key to the “astronomic” growth of his brand, which started life in the sports nutrition segment and has since expanded into mass grocery channels, where Protes are positioned by protein bars and sports nutrition products rather than in the natural/healthy snacks set.

He added: “10g of protein is minimal for the market we’re trying to play in, and our chips have 15g. Our focus is on high protein, low carb, low fat and low calories. Our consumers are label readers so they are looking more at the Nutrition Facts panel than the ingredients label. It’s about what macros am I getting?”

You can’t build a $50m business on 50 $1m SKUs

The final part of the discussion during the 60-minute live debate explored innovation and channel strategies for emerging brands, with Brad Barnhorn noting that building a platform might be important over time, but that it was critical to have one or two ‘hero’ SKUs.

It’s easy to look for the next shiny object and there are reasons to extend and build a platform," he said, "but you need to ensure that your core SKUs are winning. You can’t build a $50m business on 50 $1m SKUs.”

As for channels, he added: “Snacks are omnipresent so you’ve got to be careful to focus on one or two channels to start with, although the tendency to want to spread too fast too wide is an issue for every food and beverage company.”

It’s only a matter of time until someone comes up with a better option if you’re not constantly evolving, and that applies to both emerging and legacy brands.

“We knew that if we could offer a product line with great nutrition, taste and texture we felt like that was what it would take to sway consumers that have been picking up mainstream products for the past 25 years, and it worked. I’d love to make all the claims possible but we’re not able to do that and maintain a competitive market price.”

Scott Fiesinger co-founder, Field Trip Jerky

Know your consumer…

The important thing, said Angacion, is to know your consumers, and where and how they shop.

We started in sports nutrition in retailers such as Vitamin Shoppe and Vitamin World, but our consumers are also shopping in grocery stores in the bar sets and the sports nutrition sets, so we've gone after that as well. We’ve also seen really nice wins in c-stores. 70% of grocery shoppers are female, but 70% of convenience store shoppers are male and protein is very important to them.”

At Dang Foods, which has gained traction in natural, conventional and club channels, direct-to-consumer channels are also growing in importance, said Kitirattragarn.

Our e-commerce sales grew 300% last year… You often see higher margins and you can really target people if you know how to market very effectively on social media and using Google ad words.”

To listen to this and other sessions in the Snacking Innovation Summit, which was sponsored by Roquette and Cambridge Commodities and supported by Cargill and the Almond Board of Calfornia – click HERE to register for the event.

Below, as part of the event, SPINS has shared some data on the sub-segments of the snacks category, which shows strong growth in meat snacks, ready to eat popcorn, vegetable and fruit chips, wellness and performance bars and seaweed and plant-based meat snacks, albeit off a very small base.

It also shows steady growth in some mature categories such as potato chips, tortilla chips, puffed snacks, crackers and cracker-based snacks and sandwiches.

 

 

 

SPINS: Natural, Specialty &  Conventional Multi Outlet Retailers, Total US, 52 weeks to 12/25/16

   
       

 

     

Sub-categories (shelf-stable)

2016

2015

Dollar % change

 

PITA & BAGEL CHIPS

$286,036,974

$298,966,331

-4.3%

 

POPCORN (ready to eat)

$1,105,280,704

$948,531,986

16.5%

 

POPCORN MICROWAVE & UNPOPPED

$846,689,526

$910,485,708

-7.0%

POTATO CHIPS

$5,919,750,300

$5,762,211,244

2.7%

PRETZELS

$1,184,923,159

$1,189,437,983

-0.4%

PUFFED SNACKS

$1,732,763,101

$1,630,156,813

6.3%

SNACKS OTHER

$3,309,913,936

$3,275,423,363

1.1%

SOY SNACKS

$8,922,679

$11,789,373

-24.3%

TORTILLA & CORN CHIPS

$4,732,312,006

$4,596,462,090

3.0%

VEGETABLE & FRUIT CHIPS

$255,645,915

$229,164,240

11.6%

BARS GRANOLA & SNACK

$3,037,656,813

$3,145,660,427

-3.4%

BISCOTTI

$54,850,418

$57,943,081

-5.3%

COOKIES

$6,973,382,608

$6,837,886,283

2.0%

COOKIES FRESH

$54,535,165

$57,099,148

-4.5%

GRAHAM CRACKERS

$542,558,481

$574,514,263

-5.6%

TOASTER PASTRIES

$820,378,751

$825,347,391

-0.6%

BREADSTICKS

$29,101,325

$27,230,720

6.9%

CRACKERS CLASSIC & DELI

$2,691,517,736

$2,682,521,711

0.3%

CRACKERS RICE & ALTERNATIVE GRAIN

$326,325,403

$323,396,156

0.9%

CRACKERS SNACK & SANDWICH

$2,661,011,894

$2,548,186,498

4.4%

CRISPBREADS & TOASTS

$294,432,496

$302,422,233

-2.6%

JERKY

$892,493,711

$834,647,405

6.9%

MEAT SNACKS OTHER

$474,921,501

$458,870,060

3.5%

MEAT SNACKS PLANT BASED

$2,364,389

$2,022,679

16.9%

FRUITS DRIED

$1,001,222,303

$987,980,414

1.3%

NUTS

$4,981,364,988

$5,015,516,029

-0.7%

SEAWEED DRIED

$35,182,327

$31,739,348

10.8%

SEEDS

$321,194,870

$324,211,111

-0.9%

TRAIL MIX

$862,929,946

$802,076,648

7.6%

VEGETABLES DRIED

$10,917,286

$11,516,786

-5.2%

RICE CAKES MINI

$72,548,706

$74,070,057

-2.1%

RICE CAKES REGULAR

$152,913,354

$136,602,502

11.9%

BARS PERFORMANCE

$389,446,969

$347,600,698

12.0%

BARS WEIGHT MANAGEMENT

$361,575,150

$354,776,999

1.9%

BARS WELLNESS

$1,629,472,198

$1,452,145,422

12.2%

ENERGY GELS & SNACKS

$21,613,079

$24,691,279

-12.5%

 

 

 

 

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